27 October 2010

ACQUISITION: A group of tractors plough land owned by India's Karuturi Global, in the Gambella region of Ethiopia, Africa in this file photo. Africa’s gross domestic product expanded 4.9 percent a year from 2000 to 2008. Bloomberg photo

Indian billionaire Ravi Ruia flew to Africa every month for the past 18 months, buying coal mines in Mozambique, half an oil refinery in Kenya and a call center in South Africa for his Essar Group.
This month, executives of his Essar Energy attended a conference hosted by Nigerian President Goodluck Jonathan to attract investors in the power grid. The officials, backed by $2 billion the company raised in April on the London Stock Exchange, also mulled other “business opportunities” around Africa, the company said.
Ruia, who controls the $15 billion Essar Group with his older brother, Shashi, is not alone. Billionaire countrymen Sunil Mittal, chairman of India’s largest mobile phone provider, Bharti Airtel; Adi Godrej, chairman of Godrej Consumer Products and Harsh Mariwala, founder of Marico, have fueled a $15.8 billion buying spree in Africa since January 2005.
“Africa looks remarkably similar to what India was 15 years ago,” said Firdhose Coovadia, director of Essar’s African operations. “We can’t lose this opportunity to replicate the low-cost, high-volume model we’ve perfected in India.”
Indian companies acquired or invested in at least 79 companies in Africa, chasing business in less crowded markets after growing in a home economy that expanded by an average 8.5 percent since April 2005.
Africa’s gross domestic product expanded 4.9 percent a year from 2000 to 2008, McKinsey & Co. said in a June report. The continent’s GDP will rise to $2.6 trillion by 2020 from $1.6 trillion in 2008. The last frontier
Consumer spending may double to as much as $1.8 trillion by 2020 as infrastructure is built and farm output increases, the report said. That is the equivalent of adding a consumer market the size of Brazil.
“Africa is seen by the investing community as the last frontier,” said Walter Rossini, who manages $330 million in an India fund at Aletti Gestielle in Milan. “There is a higher risk, but then there is greater reward if the political situation remains stable over the next 10 years.”
Africa is new territory for Bharti, which paid $9 billion in June for mobile phone operations in 15 countries and will rebrand them by year’s end.
This month, Bharti executives sought advice at the Kenya offices of Bangalore-based Karuturi Global, the world’s largest rose-grower. Sai Ramakrishna Karuturi, the managing director, said Africa is driving his company’s success.
Six years ago, as he struggled to compete against flower growers in Africa and Europe with lower freight costs and larger tracts of land, he bought a small plot in Ethiopia. Sales since have grown 11-fold to $112.7 million in the fiscal year that ended March 31.
He leases 311,000 hectares of land - larger than the U.S. state of Rhode Island - in Ethiopia and Kenya, and his company sells more than half-a-billion roses a year.
“I got in on the ground floor, others got in on the second floor, but there’s a lot of floors left to go in Africa’s economic cycle,” Karuturi said. “Africa offered us a scale we could never reach in India.”
Indian acquisitions in Africa peaked in 2008, when companies closed 26 deals worth $3.1 billion. Those include the state-run Indian Farmers Fertiliser Cooperative’s $721 million purchase of Industries Chimiques du Senegal, an idle phosphates producer that once was the country’s largest industrial plant. Ernst & Young handled 11 deals since 2005.
“We are seeing Indian companies look at Africa in a major way,” said Anuj Chande, the London-based head of the South Asia Group at advisory and accounting firm Grant Thornton U.K. “Compared to India, valuations are quite attractive. We’re expecting to see a lot of midsize deals across a variety of sectors.” Buying spree
Apollo Tyres, India’s second-biggest tiremaker by market value, bought Durban, South Africa-based Dunlop Tyres International for $62 million in April 2006. That gave Apollo two manufacturing plants and a retreading unit in South Africa and Zimbabwe, and brand rights to 32 African countries.
Adi Godrej bought a hair-color company in South Africa and a soap and body-lotion maker in Nigeria. His Mumbai-based Godrej Consumer Products gets 23 percent of its total sales outside India, including Africa.
Marico paid 520 million India rupees ($12 million) to buy the consumer division of Durban-based Enaleni Pharmaceuticals Consumer Division in October 2007. Two months ago, it bought South African health-care brand Ingwe for an undisclosed price.
Dabur India started shopping on the continent in 2004, when it bought a hair-care brand in Egypt and then a Nigerian cosmetics company.
“I am not even a fly on the wall in India, but in Ethiopia I am the largest investor, the second-largest employer after the government,” said Sai Ramakrishna Karuturi, whose company owns professional football and volleyball teams. “To do that in India, you have to be a Tata or an Ambani.”

Germany looks for rare earth element partnerships due to scarcity:

According to two unnamed officials, safeguarding REE supplies is “crucial” for Germany, so German Economy Minister Rainer Bruederle, whose ministry is hosting an Oct. 26 international conference, is attempting to forge strategic partnerships with seven countries — Mongolia, Namibia, Nigeria, Kazakhstan, South Africa, Chile and Peru — to secure commodities, including REE and copper. China needs to realize protectionism is not a “one-way street,” Bruederle said. October 26, 2010 - (Reuters) - The World Trade Organisation and the EU said on Tuesday they were seeking a solution to German concerns about reported Chinese restrictions on exports of rare earth elements (REE) used to make many high-tech products. At a conference in Berlin, where the German government warned of the severe impact of the scarcity of the 17 minerals with magnetic, luminescent and other properties, the EU said it was watching China's actions for possible legal implications.Frank Hoffmeister, a top aide of European trade chief Karel De Gucht, was asked at the seminar whether the EU planned legal action against China over the reported export restrictions. "It is clear we are monitoring the situation quite closely. We need to have clear facts," he answered.The head of the WTO, Pascal Lamy, prescribed a completion of stalled global trade talks as a way of eliminating uncertainty about access to scarce raw materials. Lamy said the Doha round -- deadlocked since 2008 -- would set clear rules on the transport, sustainable exploitation and tariffs of raw materials, and avert global political tensions."A completion of the Doha Round will serve as a stepping stone towards better international trade rules in resource sectors," Lamy told the conference.Germany's electronics industry has said the market for rare earths, used to manufacture a range of high-tech products, had become "critical" due to reported restrictions on exports from China, which produces 97 percent of the world's supply. According to two unnamed officials, safeguarding REE supplies is “crucial” for Germany, so German Economy Minister Rainer Bruederle, whose ministry is hosting an Oct. 26 international conference, is attempting to forge strategic partnerships with seven countries — Mongolia, Namibia, Nigeria, Kazakhstan, South Africa, Chile and Peru — to secure commodities, including REE and copper. China needs to realize protectionism is not a “one-way street,” Bruederle said.The country's dominance of rare earths used in high-tech products has drawn growing international attention after reports that the government has been choking off shipments, possibly for political reasons.Beijing has denied any plans to cut export quotas of the minerals used to make cars, computers, cell phones and other high-technology products. Washington has called it a potential threat to the U.S. economy and national security. China's media has accused Western countries of making unreasonable demands over the cheap supply of rare earths.German Economy Minister Rainer Bruederle said his country was "severely affected when it comes to energy resources and ... rare earths which are growing scarce". "When speculation is rife, you lose the foundation in the economy," he said. "And that is detrimental for the producing industries. Pricing frameworks must remain on our agenda."Germany, which depends on raw materials from abroad to power its export-driven economy, this month announced a government strategy to secure access to crucial raw materials and called on countries to address the issue together at international talks.

14 October 2010

Launching on the eve of International Day for the Eradication of Poverty, film showcases the
power of helping the poor learn practical skills, start livelihoods and save
– Trickle Up (www.trickleup.org), an international poverty
alleviation organization that empowers people living on less than $1.25 a day to take the first
steps out of poverty, has released a documentary that profiles the impact of its work and the
people it affects.
“The Test of Poverty” follows two women living in extreme poverty in West Bengal, India, as
they participate in Trickle Up’s program and work to change the effects that generations of
poverty have had on their families’ lives. The film shows that addressing the needs of the ultra
poor – those living on less than $1.25 day – involves more than just providing them with capital,
and must be viewed through a wider lens. The film also captures the powerful effects that
increased self‐confidence and empowerment that come from participating in Trickle Up’s
program have in helping women break the vicious cycle of extreme poverty.
As the International Day for the Eradication of Poverty approaches on October 17th, “The Test
of Poverty” underscores the theme designated by the United Nations: "From Poverty to Decent
Work: bridging the gap." According to the UN, this day of observance comes at a time when
people living in poverty are even more uncertain about employment stability, working
conditions, training opportunities and the availability of social protection.
“The Test of Poverty” was directed by Gautam Bose and produced with support from the
Consultative Group to Assist the Poor (CGAP), which is spearheading a global effort to
understand how safety nets, livelihoods, and microfinance can be sequenced to create
pathways for the poorest to graduate out of extreme poverty.
Trickle Up takes a comprehensive approach to addressing the needs of the ultra poor. The
organization provides seed capital, training and savings support to kick‐start microenterprises
and create a savings habit that endures. The grants buy things like tools, seeds and fertilizer,
and goats—assets that help build income and stability. The savings groups work like community
banks; the members save money, make loans to each other, and pay interest that grows the
group fund. In 2009 alone, Trickle Up served over 10,000 new participants. Each new or
expanded enterprise impacts five lives, which means over 55,000 lives have been touched.Launching on the eve of International Day for the Eradication of Poverty, film showcases the power of helping the poor learn practical skills, start livelihoods and save.The Test of Poverty shows how Trickle Up helps the ultra-poor holistically and with lasting results.
To view a shorter 4 minute version, please visit:http://www.youtube.com/watch?v=n_bUTKI2Lq0

9 October 2010

A two million-euro jatropha project to produce bio-energy at Walewale in the northern part of Ghana has been launched by the European Unio n in the area.

The five-year project would use unfertile lands in the area to cultivate jatroph a plants and process the seeds to obtain crude oil and its by-products.
Professor Giuseppe Enne, Project Coordinator of the Ghana Jatropha Project and t he Nuclea Ricerca Desertification of Sassari University of Italy, announced Thur s day that an appropriate and cost-effective expeller for Jatropha oil extraction w ould be constructed.
The project aims also to improve Ghana’s sustainable renewable energy, to create income-generating activities and to mitigate land degradation effects in rural a reas in the country.
Ghana’s Council for Scientific and Industrial Research, Ministry of Food and Agr iculture, Technology Consultancy Centre of the Kwame Nkrumah University of Scien c e and Technology and New Energy, a non-governmental organization, are collaborat i ng to ensure successful implementation of the project.
Enne said the project would develop the marketing of primary and secondary produ cts of jatropha and the setting up of community-based organisations and micro-en t erprises to reduce poverty.
In addition, he said, the project would realise direct desertification mitigatio n actions in the target areas by using drought resistant species with a high mar k et value.
Mr. San Nasamu Asabigi, Deputy Northern Regional Minister said jatropha could be an alternative to reduce the energy crisis facing the country.
“About 69 per cent of the total energy consumed in Ghana is from the already dep leted forest, 10 per cent from electricity and 21 from imported petroleum”.
Source africanmanager.com

8 October 2010

Sweet pepper gene confers resistance to bacterial wilt.
Scientists in Uganda will next week start field trials of a banana variety genetically engineered to resist a bacterial disease that has been decimating crops across central Africa.
The new variety is part of a wider effort to improve the East African Highland banana, a fruit so important to Ugandans that its name, matooke, is synonymous with 'food' in one of the local languages. But delays to a law regulating the commercial growing of genetically modified (GM) food in the country means it is not clear when the improved banana could be released to farmers.
The bananas have a gene from green pepper to protect against banana Xanthomonas wilt (BXW), which costs farmers in Africa's Great Lakes region an estimated half a billion dollars every year. Bananas infected with BXW ripen unevenly and prematurely, and eventually the entire plant wilts and rots. The disease was originally found in Ethiopia, but was discovered in Uganda in 2001 and has rapidly spread to the Democratic Republic of Congo, Rwanda, Kenya, Tanzania and Burundi.
The sweet pepper gene produces a protein called HRAP that strengthens the plant's ability to seal off infected cells. The idea was pioneered by scientists at the Academia Sinica in Taiwan, where it has been shown to improve the disease resistance of vegetables including as broccoli, tomatoes and potatoes.

The Ugandan research team, based at the National Agricultural Research Laboratories in Kawanda, received a royalty-free licence to use the technology in 2006.
Six of the eight GM banana strains developed with the green pepper gene showed 100% resistance to BXW in the lab1.
"This is the first time this gene has been used in Africa, and it is the first time the technology is going to be tested in the field," says Leena Tripathi, a biotechnologist from the International Institute of Tropical Agriculture in Kampala, and lead investigator of the Ugandan project.
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5 October 2010

Cape Town (South Africa) — Governance standards have improved significantly in Angola, Liberia and Togo over the past four years, but have declined in Eritrea and Madagascar, according to a leading survey assessing the quality of governance across Africa.

This year's edition of the Ibrahim Index of African Governance, released in Johannesburg on Monday, shows that Mauritius remains Africa's best-governed country, with a score of 82 out of a possible 100 on the index. Somalia is still the worst-governed nation, with a score of 8.

Liberia's score showed the biggest increase, from 32 in 2004/05 to 44 in 2008/09, the latest years for which data are available. Angola's score also rose steadily over the four years, from 31 to 39, while Togo's improved from 36 to 43.

All three countries nevertheless remained in the bottom half of the continent's rankings. Of 53 nations surveyed, Liberia was in 36th place, just ahead of Niger and Mauritania and immediately behind Cameroon and Ethiopia. Togo was in 39th and Angola in 43rd place.

Eritrea's score on the index dropped from 40 to 33 over the four years, and it was ranked in 49th place, only four places above bottom-ranked Somalia, where the federal government does not even control the whole of the capital, Mogadishu.

Madagascar, where there was an unconstitutional seizure of power 18 months ago, saw its score on the index drop from 56 to 48, but it remained higher on the rankings, as the 29th best-governed country in Africa.

Somalia is followed as the worst-governed country in Africa by Chad, the Democratic Republic of Congo, Zimbabwe, Eritrea, Sudan, the Central African Republic, Equatorial Guinea, Guinea and Cote d'Ivoire.

The survey indicates that the continent's best-governed region is Southern Africa, with an average score on the index of 57, followed by North Africa (54), West Africa (50), East Africa (45) and Central Africa (38).

The Ibrahim index is produced by the Mo Ibrahim Foundation, which was founded by the Sudanese cellphone entrepreneur of the same name. The foundation describes the index as "a tool to hold governments to account and frame the debate about how we are governed."

Citing what it saw as the most interesting trends seen in this year's survey, the foundation said more than 40 countries had seen "some form of improvement" in the categories of sustainable economic opportunity and human development.

"Generally, African citizens are healthier and have more access to economic opportunities than was the case five years ago …

"However, the category that gender sits within, participation and human rights, makes for less encouraging reading. Thirty of Africa's 53 states have declined in participation and human rights performance over the past five years - notwithstanding some improvements around gender issues.

"Overall … the impressive sustained economic progress and human development on the continent stand in contrast to deterioration in national performance in security, rule of law, participation and rights."

The index measures the delivery of public goods and services by government and non-state entities, using four main categories - including 88 criteria - by which to judge the performance of nations: safety and the rule of law, participation by citizens and human rights, sustainable economic opportunity and human development.

It has laid emphasis in recent years on boosting the role of African scholars in producing the index, and this year cites the involvement of institutions from Benin, Egypt, Ghana, Senegal and South Africa.

Introducing this year's index, Mo Ibrahim said the index had strengthened the assessment of governments' commitment to gender equality by adding indicators assessing women's political and economic rights and examining legislation combating violence against women. It had also introduced indicators assessing the provision of anti-retroviral treatment.

4 October 2010

At the end of August, government leaders from China and South Africa announced that they would advance bilateral cooperation in a wide range of areas, including higher education and scientific research. The partnership follows a series of collaborations that have been set up following the establishment of the Forum on China-Africa Cooperation in 2000 and the formulation of the Chinese government's 'Africa Policy'.

This policy was initiated in 2006 to promote student and faculty exchanges, training in African and Chinese languages, and research cooperation in fields of mutual interest, such as bio-agriculture, mining and medicines.

Since 2006 a large number of African nations including Egypt, Nigeria and Tunisia have signed higher education and research agreements with China and started joint research projects.

In the past four years, China has provided training to around 15,000 African professionals including scientists, doctors, nurses and administrators. It has also started to construct 26 hospitals on the continent and built 30 centres for the treatment of malaria. To enable collaboration, China has established 25 Confucius institutes in 19 African countries, where Mandarin language classes are offered.

Research collaboration is particularly increasing in the area of science and technology. In March this year, the Forum on China-Africa Cooperation, FOCAC, which includes representatives from China and 49 African countries, launched a series of joint research projects, training programmes and academic staff exchange programmes between partner countries.

China has also promised to offer research equipment to African scientists who return to their home countries on completion of long-term research projects in the country, and a Chinese-funded network of agricultural technology centres in Africa is currently being planned and developed.

Drivers and benefits

The prime aim of China's Africa initiatives, including its higher education and research partnerships with the continent, is to secure a share of Africa's natural resources (especially oil, iron and copper) for use towards its growing population and booming economy. Domestic economic growth, in turn, is likely to give China more global political power.

In addition, by diversifying its trade partners and including African nations, China appears to be trying to limit the financial risks involved in being dependent on a smaller number of trade partners. China also sees Africa as a potentially large market for its own products.

Collaboration in areas such as higher education and science and technology could create the networks necessary to promote these goals.

China's projects can be valuable for Africa, given the higher education and brain drain challenges faced by the continent. The sheer size of the Chinese market, coupled with projections for continued economic growth, can offer good trading opportunities for Africa.

African partners also hope to learn from China's rapid economic development over the past decade. At least 35 of Africa's 53 countries are currently benefiting from Chinese-funded projects to improve infrastructures in the areas of transport, electricity and telecommunications. For Africa, these Chinese activities are important for economic development and brain gain.

The two regions are good partners in the sense that they share no historical conflict and collaborate on the principle of 'non-interference' in each other's politics (apart from China's prohibition of having diplomatic relations with Taiwan).

Analysts have argued that China's emphasis on national sovereignty is attractive to those African states that in the past have been reluctant to implement reforms imposed by Western donor institutions and countries, which often came together with requirements such as improving governance.

Meeting Africa's long-term development needs?

While Chinese politicians argue that their Africa initiatives are mutually beneficial, critics believe that China's motives for Africa collaboration are more profit-oriented than its philanthropic rhetoric would suggest.

According to the African Development Bank, China is on its way to become Africa's most important economic partner. Since the launch of the Forum on China-Africa Cooperation in 2000, China-Africa trade has grown at an annual average rate of 33.5%, from US$10 billion in 2000 to US$107 billion in 2008. China has already become South Africa's largest export destination by country since the start of 2009, according to the official Xinhua News Agency.

Africa profits from these links with China in several ways.

Between 2000 and 2008, the export of African products to China has doubled, and this export growth is still accelerating. China has been playing an increasingly important role in financing and implementing infrastructural projects on the continent, which are improving Africa's future potential for economic development. China has also established special economic zones on the continent, where African goods are being produced.

African Development Bank representatives, however, have argued that there is no guarantee that China will help advance the production of African goods that are not aimed at export to China.

Critics argue that China's initiatives are not always tailored to Africa's needs.

One example is Chinese-sponsored training programmes for African students, who study in China for several years, taking language courses while they study in Chinese. Once these students return to Africa, however, they often struggle to assimilate scientific concepts in a foreign language. To some extent, such difficulties may be due to the fact that China has relatively limited experience in large-scale higher education collaboration.

2 October 2010

QUALCOMM EXPANSION PLANS TO AFRICA.

Douala, Cameroon October 2nd (News.Cameroon-Today.com) - Qualcomm the wireless services major from San Diego California have announced its plans to foray into various pats of Africa including Cameroon. The top officials of the telecom provider indicated that they plan to operate in the 3 G segment in a massive way.

Qualcomm based out of San Diego has planned to expand its services all across West Africa In a press release late yesterday the wireless services provider indicated that it plans to open an office in Lagos, Nigeria which will be the basis from where it will operate in the Western African regions.

Cameroon Map - The Map of the republic of Cameroon, Africa

The top brass of Qualcomm Africa also stated that their office in Lagos would service their mobile and wireless operations that would essentially spread across Nigeria, Ghana, Senegal, Ivory Coast and Cameroon and would be the hub for all their western African operations. The latest hub is intended for QCOM Wireless Technologies Limited which is a fully owned subsidiary of Qualcomm.
Qualcomm stated that their research has indicated that the 3G technology which has just started entering into Africa is showing great promise and they plan to focus highly in the segment. They said that they plan to launch a whole bevy of activities to support growth and development of the 3G technology in the continent. The wireless biggie says that statistics reveal that more than three fourths of the rural population in countries like Cameroon and Nigeria cannot be connected by fixed line telecom networks and hence can be benefitted highly by a wireless technology.